The world's biggest beer deal just rose to $104 billion

Budweiser owner Anheuser-Busch InBev has
raised its takeover offer for its rival brewer SABMiller to
$66.85 a share, valuing the company at around $103.5 billion.

AB InBev, the world's biggest brewer, made the improved offer
after an earlier offer of $64.77 a share was
rejected on Friday.

SABMiller, the world's second-biggest brewer, is listed in
London, and under UK takeover laws both sides have until
Wednesday to reach an agreement on a deal. Takeover talks were
first revealed in mid-September.

SABMiller, which makes beers including Peroni, Grolsch, and
Fosters, has been playing hardball with AB InBev, knocking back
several takeover offers.

SABMiller is facing pressure from its biggest shareholder,
Altria, to do a deal but has promised a $1 billion cost-cutting
program that it says will deliver better value for investors.

In a note sent to clients on Friday, HSBC says it looks as if
SABMiller is using the same tactics as Anheuser-Busch used in its
2008 merger with InBev to drive the price higher.

Analyst Carlos Laboy and his team say:

Our take is that history is possibly repeating itself as this is
nearly the identical, and ultimately successful, tactic A-B
management used to force a higher bid from InBev from USD65 to
USD70 in 2008.

A-B management made similar claims that InBev was undervaluing
its world-class brands and also announced an acceleration of its
brewery efficiency programme Blue Ocean, a cost reduction blue
print which would eventually fall into ABI’s hands.